On both domestic and foreign fronts, executive administrations tend to tackle issues rather quickly. President Trump, for instance, recently ordered airstrikes on Syria in response to Bashar al-Assad’s use of chemical weapons. Trump also pledged to repeal and replace the Affordable Care Act, though there have been incredible theatrics regarding that promise. Notably missing from Trump’s policy proposals, however, is any mention of Social Security reform. This isn’t out of the ordinary. For years, both Republican and Democratic administrations have delayed any reform, instead passing the baton onto future executives. More and more of the government budget is allocated to Social Security and Medicare annually. Eventually, something must be done. But when?
Over the past 50 years, the median age of American citizens has risen substantially. The portion of citizens over the age of 65 has grown from a mere 9.15% in 1960 to 14.79% in 2015. This has placed increased strain on Social Security, with fewer people paying into the system and more extracting benefits. By 2034, the Social Security Administration’s trust fund will no longer be able to cover the annual deficits of the program. Financial shortcomings that have been overlooked by previous administrations will need to be addressed to keep Social Security solvent.
Reforming Social Security by cutting benefits is, unfortunately, unpopular. Individuals who have paid into the program for their entire careers do not want their benefits slashed, and few politicians would view it as politically expedient to do so. No administration wants to be remembered for cutting benefits or raising the retirement age, hence why previous presidents have largely ignored reform. President Clinton reportedly considered partial privatization of Social Security toward the end of his term, but he never followed through. Privatization has long been considered a potential solution, though it has not come without political contention. Major lobbying efforts on behalf of the American Association of Retired Persons (AARP) have repressed the move towards individual accounts. Opinion polling has shown majority support for privatization, but closer inspection reveals a general apathy regarding the issue, perhaps skewing the data. The delicate balance of reform and electoral politics has caused significant apprehension among lawmakers.
After his reelection in 2004, President George W. Bush made Social Security reform a top priority. He took a similar approach to Clinton: partial privatization, or the creation of individual accounts. This would allow workers to voluntarily invest their own money, supposedly resulting in higher rates of return and saving the program from running up enormous deficits. Bush’s initiative failed after Congressional Democrats battled the bill, and it was eventually slid under the table in the aftermath of Hurricane Katrina. Bush, who lacked the political capital to push reform, neglected to try again in the wake of his initial failure. Social Security reform would thus be delayed again, a problem for the next administrations to tackle.
The Obama administration did not fare well in the field of Social Security reform. Admittedly, it was not a top priority for Obama, as was the case for many liberals. However, following the economic crisis in 2008-2009, Obama called for the creation of a bipartisan commission dedicated to fiscal and budgetary reform. This culminated in the Bowles-Simpson Commission, headed by former White House chief of staff Erskine Bowles and former senator Alan Simpson (R - Wy.). The commission’s final report promoted a gradual increase in the retirement age, among other debt reduction proposals. But the Obama administration never undertook the recommendations of the commission, instead opting to put reform on the backburner.
Reforming Social Security now lies before President Trump. Despite his assurances, reform is inevitable and necessary. Partial privatization may be the next step in the natural progression of reform, but this is dependent largely on the political capital of Trump or whoever succeeds him. Regardless, the United States is certainly approaching a cliff — one which will determine the future of Social Security in the country. Trump is currently at the helm, but don’t be surprised if he simply passes the responsibility on to his successor.